Will Nichols for BusinessGreen, part of the Guardian Environment Network

Monday 25 July 2011 09.35 EDT

The government and industry remain convinced electric cars will see an upswing in demand, despite a dramatic fall in the number of the grants issued during the second quarter of the year to those motorists purchasing electric vehicles (EV).

According to figures published by research charity the RAC Foundation late last week, the second quarter of the year saw just 215 cars bought under the government's EV grant scheme, which knocks £5,000 of the price of a new electric car.

This contrasts with 465 taken up in the first three months of the year, and takes the total of cars bought under the scheme to 680, leaving the UK's electric fleet still struggling to top 2,500 vehicles.

The low uptake means just £3.4m of the £43m put aside by the government until the end of March 2012 has been spent.

Estimates vary, but the WWF and the Committee on Climate Change say at least 1.7 million electric cars need to be on the UK's streets by 2020, and 6.6 million a decade later, if the country is to meet its climate change targets.

"The figures show the mountain we have to climb if the national car fleet of 28 million vehicles is to turn truly green," Professor Stephen Glaister, director of the RAC Foundation, said in a statement. "Even with the grants, electric cars are still much more expensive than similar-sized petrol and diesel models."

However, a spokesman for the Society of Motor Manufacturers and Traders (SMMT) told BusinessGreen the numbers were misleading as most car sales showed a decline after March, when 20 per cent of new car registrations are made.

He said it was "still early days" for the industry as a number of models, such as the Nissan Leaf, only came on to the market part of the way through the year.

"No one in industry is worrying as it is still such an early stage," he said, adding that the expansion of charging infrastructure and the release of new models next year should result in an increase in sales.

A DfT spokeswoman echoed the SMMT view, predicting an upswing in purchases next year.

"Relative to the number of electric cars registered in previous years, the numbers bought over the last six months represent a step change," she said. "We expect uptake to increase as more vehicles come to market... and [the] Chargemaster [announcement] is a clear sign of the private sector getting the bit between its teeth to support this new market as well."